Unable to install MSDE on Windows XP SP2 or SP3

Description

I have images that had programs on that worked on V2.xx, I have now updated to 3.0.4 and now the program does not work/run correctly.

I have deleted the installed XP and re-installed XP, re-formatting the C drive to ensure no problems exist.
Trying to run an MSDE install program the installer just dis-appears.
I have tried using the latest beta version and it still fails
I have ensure the latest guest additions are installed and that XP is happy.